Thursday, July 28, 2016

Fear about a possible global recession continues to swirl following the United Kingdom’s decision to exit the European Union.

Marc Faber, Swiss investor and editor of the ‘Gloom, Boom & Doom Report’, thinks there has been an overreaction to the news.

“The markets are going down because the economic news globally is unfavorable,” Faber told the FOX Business Network’s Connell McShane. “We’re moving into a recession that has nothing to do with Brexit.”

Faber added: “I do not think that it’s as dramatic as the market reaction has been. “It’s just been that the market participants believe that to stay in the EU would be favorable, and to leave would be unfavorable."

The Swiss investor compared the current situation between the U.K. and the EU to Switzerland’s historic fight for its own freedom.

“In the 13th century we fought the Habsburg Empire to be free and not to have foreign justice and foreign laws and not to pay taxes to foreign overlords,” he explained. “This is precisely what the EU does with all the countries. They want to impose courts of justice, taxes, regulations, new laws and most of which inhibit economic growth. This is a victory for freedom and for people, the Brits.”

Faber also said the Brexit will be the “perfect excuse” for global central banks to “coordinate the monetary policies to print even more money.”

Monday, July 25, 2016

Despite the world’s focus being centered on the upcoming Brexit vote, one investor says Europe is becoming “economically irrelevant.”

Marc Faber, editor of the “Gloom, Boom & Doom Report,” joined the FOX Business Network’s Risk & Reward and explained why he believes Europe’s economy is no longer as significant as it once was.

“The future of the world, economically, is in Asia—India, China, Indonesia and the other Southeast Asian and Indo-Chinese countries and emerging economies,” Faber said. “The Western world, relative to emerging economies, is diminishing in terms of importance—also politically and geopolitically.”

Faber also said if the U.K. decided to leave the European Union, it would send a message to the elites and bureaucrats who impose regulations that “stifle economic development.”

“An exit would be good for Britain, and it would not destroy the financial markets, quite on the contrary,” he said. “I think if Britain decided to leave the EU the stock market would rally and the British pound would rally.”

Friday, July 22, 2016

'Gloom, Boom & Doom' Report Publisher Marc Faber weighed in on the impact of Brexit on the global markets and economy as well as central bank policies.

Faber raised doubts about the notion that markets, at least in the U.S., are gaining their confidence back since the U.K. vote to leave the European Union.

“Regarding the confidence, I’m not so sure because if you look at the performance of treasury bonds, they would indicate that there is a sense that the economy’s weakening and that there are problems in the financial system. Also if you look at the performance of European bank stocks, they are horrible performers,” Faber told the FOX Business Network’s Dagen McDowell.

He then predicted central banks’ reaction to Brexit globally.

“Clearly Brexit means more money printing by central banks; They will continue to intervene. And I think before the year end we’ll have some form of QE4 in the U.S.”

Faber then responded to Federal Reserve officials attaching a low probability to the risks of a potential U.S. recession in 2016.

“The Fed was fast asleep ahead of the 2007-2008 recession. So the fact that they assign a low probability to a recession doesn’t give me any comfort at all.”

Faber explained why a lack of additional quantitative easing globally could actually lead to a recession.

“I think the problem will be if there are no additional QEs around the world…is that asset prices will no longer go up and we’ve seen this already in London properties, in New York properties – and this will have a negative impact on the economy. The recession in my view is not going to come really from the economy per se, but from asset price deflation.”

Monday, July 18, 2016

Gold’s investment case has been strengthened by the U.K.’s vote to quit the European Union as the fallout may spur the world’s central banks to step up easing, hurting currencies and favoring bullion, according to Marc Faber, publisher of the Gloom, Boom & Doom Report.

The U.S. Federal Reserve may even embark on a fourth round of quantitative easing, or QE4, Faber said in an interview on Bloomberg Television on Wednesday, adding that he typically buys bullion every month. While he also likes gold shares, they need to correct first after recent gains, he said.

Gold has soared after the U.K.’s vote last week as investors seek a haven from financial turmoil and contemplate the possible implications, including additional steps from central bank policy makers in Europe, the U.S. and Asia. Holdings in bullion-backed exchange-traded products have swelled to the highest level since September 2013 as banks including Goldman Sachs Group Inc. have boosted their price forecasts.

‘Print More Money’

“If Brexit is used as an excuse, the central banks will print more money, QE4 in the U.S. is on the way and the depreciation in the purchasing power of currencies will continue,” Faber said in the interview from Hong Kong. “In that situation, you want to own some gold.”

Bullion for immediate delivery rose as much as 0.7 percent to $1,321.55 an ounce, and traded at $1,321.24 at 1:57 p.m. in Singapore, according to Bloomberg generic pricing. In the immediate aftermath of the vote on Friday prices surged to $1,358.54, the highest in more than two years.

Gold has advanced 25 percent this year as the European Central Bank and Bank of Japan embraced negative rates to kick start growth and the Fed pauses after its first hike since 2006 last December. The U.S. central bank undertook three rounds of quantitative easing starting in 2008 to overcome the impact of the global financial crisis.

New Headwinds

Fed Governor Jerome Powell said Tuesday the vote has the potential to create new headwinds for economies, including the U.S., introducing uncertainties that may merit reassessing policy. Traders now see a greater probability the bank will cut rates in upcoming meetings than raise them.

Faber’s views add to a bullish chorus about bullion in the wake of the poll. The metal may stand at the start of a major bull market should the Brexit vote prove to be a forerunner of greater political and financial instability around the world, Evolution Mining Ltd.’s Jake Klein said on Tuesday.

Still, not every one is optimistic. Veteran investor Jim Rogers said this week that he’d rather seek haven in the dollar than gold, given that bullion had already rallied in 2016 before the referendum. Credit Suisse Group AG has said it’s neutral on gold over the next three to six months.

“Global growth has contracted, in other words, growth rates have been reduced and many countries are in recession already. That has nothing at all to do with Brexit,” Faber said. “Brexit is actually not about an end of globalization. On the contrary, it’s about people that rebel against the arrogant elite in the financial centers.”

Friday, July 15, 2016

All paper currencies are "doomed" thanks to central bank policies around the world, said Marc Faber, editor of the Gloom, Boom & Doom Report.

"They are going to become worthless because of money printing. In other words, the purchasing power is going to continue to diminish as it has diminished for the last hundred years," Faber, known as Dr. Doom, said in an interview with CNBC's "Power Lunch" Friday.

And the Brexit vote last week means even more money printing in the U.K., Japan and the United States, he said.

Therefore, he expects the dollar to go down against gold, silver and platinum — which he believes are going to "vastly" outperform the U.S. stock market.

"Investors should have some exposure to precious metals," he advised. He sees value in mining companies, agricultural stocks and oil servicing companies.

Overall, however, the U.S. is a "fully priced market," Faber said. That said, he wouldn't go as far as shorting the market, because he doesn't like to do so in a money-printing environment.

Tuesday, July 12, 2016

The global economy has been weakening and could worsen ahead, but there are still a lot of market opportunities for investors, said Marc Faber, editor of the Gloom, Boom & Doom Report.

"We're all on the Titanic, but the Titanic still has maybe a few days to travel before it collapses so we might as well enjoy the journey," Faber, also known as Dr. Doom, told CNBC's "Squawk Box."

Anticipating a downtrend, Faber said he's holding physical gold in safe-deposit boxes and buried in his garden, as well as holding gold mining shares. For "ordinary" investors, he recommended holding gold exchange traded funds (ETFs), such as the Market Vectors Gold Miners ETF, or GDX.

Faber said that every investor should hold gold, calling it his preferred currency.

But that didn't mean Faber was dissing on the rest of the stock market.

Faber said the global economy's downtrend was likely to be exacerbated by the U.K.'s vote to leave the European Union (EU), or Brexit, but he added that this wasn't necessarily bad news for the stock market.

"Brexit will give a perfect excuse to the Federal Reserve not to increase interest rates and be most likely to launch QE4," or another round of quantitative easing to purchase assets in the market," Faber said. "Then the other central banks will also join and also launch further easing measures, printing money and so the global economy could worsen and stocks actually could go up."